Correlation Between Amaroq Minerals and Live Nation

Can any of the company-specific risk be diversified away by investing in both Amaroq Minerals and Live Nation at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Amaroq Minerals and Live Nation into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Amaroq Minerals and Live Nation Entertainment, you can compare the effects of market volatilities on Amaroq Minerals and Live Nation and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Amaroq Minerals with a short position of Live Nation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amaroq Minerals and Live Nation.

Diversification Opportunities for Amaroq Minerals and Live Nation

0.37

Correlation Coefficient

Amaroq Minerals  Live Nation

Weak diversification

The 3 months correlation between Amaroq and Live is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Amaroq Minerals and Live Nation Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Live Nation Entertainment and Amaroq Minerals is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Amaroq Minerals are associated (or correlated) with Live Nation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Live Nation Entertainment has no effect on the direction of Amaroq Minerals i.e., Amaroq Minerals and Live Nation go up and down completely randomly.

Pair Corralation between Amaroq Minerals and Live Nation

Assuming the 90 days trading horizon Amaroq Minerals is expected to under-perform the Live Nation. In addition to that, Amaroq Minerals is 1.14 times more volatile than Live Nation Entertainment. It trades about -0.05 of its total potential returns per unit of risk. Live Nation Entertainment is currently generating about -0.06 per unit of volatility. If you would invest  13,276  in Live Nation Entertainment on December 21, 2024 and sell it today you would lose (1,037) from holding Live Nation Entertainment or give up 7.81% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.41%
Values	Daily Returns

Amaroq Minerals  vs.  Live Nation Entertainment

Amaroq Minerals

Risk-Adjusted Performance

Very Weak

Over the last 90 days Amaroq Minerals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Live Nation Entertainment

Risk-Adjusted Performance

Very Weak

Over the last 90 days Live Nation Entertainment has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Amaroq Minerals and Live Nation

The main advantage of trading using opposite Amaroq Minerals and Live Nation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amaroq Minerals position performs unexpectedly, Live Nation can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Live Nation will offset losses from the drop in Live Nation's long position.

The idea behind Amaroq Minerals and Live Nation Entertainment pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

Check out your portfolio center.

Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Correlations module to find global opportunities by holding instruments from different markets.